Advanced Transportation Industry Review

Report Highlights

INTRODUCTION

Security issues in transportation were a significant industry driver in 2003, and remain so in 2004. The need for industry standards continues, but 2003 saw increased collaboration in the industry to establish accepted standards. The industry as a whole recognizes the need for technology to track cargo and trucks. WalMart announced its intention to require suppliers to track pallets of products delivered to its warehouses. The potential market is huge.

A number of pilot programs are now underway, and performance is being measured. Regulators have yet to indicate what the mandated requirements will be. The new Transportation Security Agency has focused most of its efforts on airport security. In the next several years, train and highway safety will receive greater consideration.

Telematics includes a connection from the vehicle to an outside network for data transmission. The industry is still struggling to determine whether or not the connection needs to be an anytime, anywhere connection, in addition to determining what the content will be delivered over the connection for a fee.

Telematics service providers are facing competition from the cellular phone service providers, who intend to offer, or are offering similar services for an additional fee. OnStar Service remains this flagship for telematics service providers in the U.S. ATX Technologies remains OnStar's primary competitor. In Japan, new service options were introduced by Toyota and Nissan.

Telematics systems are currently installed at the factory on many vehicles. The presence of the hardware, even if the service is not activated, has led to growing concerns regarding consumer privacy. Law enforcement can use, and has already used, the technology to track and record an unknowing suspect with a proper warrant.

Navigation systems have fallen in price, but remain unattractive to most consumers. The addition of dynamic traffic data delivery may make the systems more attractive. The first such systems will become active on a small scale in 2004.

In the U.S., in vehicle entertainment systems are now common options in sport utility vehicles and luxury sedans. Drive by wire continues to develop, with hybrid electromechanical systems entering the market.

Telematics technology continues to find a market amongst fleet owners and operators. Smaller fleets still lag in their adoption of the technology.

This publication is a compilation of technical and -related developments that have taken place in the transportation technology sector during the past year. It reports on improved safety systems, sensors and new sensor technology. Discussions focus on electronic toll collection (ETC), vehicle navigation, traffic management, highway construction, research and development, fleet management, commercial vehicle operations (CVO), airports and air terminal systems and global positioning systems (GPS).

Also included are funding, joint ventures and other arrangements, decisions and competition.